Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
The Only Thing Systematic Is The Destruction Of America - 29th Sep 20
Fractional-Reserve Banking Is The Elephant In The Room - 29th Sep 20
Gold And Silver Follow Up & Future Predictions For 2020 & 2021 – Part I - 29th Sep 20
Stock Market Short-term Reversal - 29th Sep 20
How Trump co-opted the religious right and stacked the courts with conservatives - 29th Sep 20
Which RTX 3080 GPU to BUY and AVOID! Nvidia, Asus, MSI , Palit, Gigabyte, Zotac, MLCC vs POSCAPS - 29th Sep 20
Gold, Silver & HUI Stocks Big Pictures - 28th Sep 20
It’s Time to Dump Argentina’s Peso - 28th Sep 20
Gold Stocks Seasonal Plunge - 28th Sep 20
Why Did Precious Metals Get Clobbered Last Week? - 28th Sep 20
Is The Stock Market Dow Transportation Index Setting up a Topping Pattern? - 28th Sep 20
Gold Price Setting Up Just Like Before COVID-19 Breakdown – Get Ready! - 27th Sep 20
UK Coronavirus 2nd Wave SuperMarkets Panic Buying 2.0 Toilet Paper , Hand Sanitisers, Wipes... - 27th Sep 20
Gold, Dollar and Rates: A Correlated Story - 27th Sep 20
WARNING RTX 3080 AIB FLAWED Card's, Cheap Capacitor Arrays Prone to Failing Under Load! - 27th Sep 20
Boris Johnson Hits Coronavirus Panic Button Again, UK Accelerting Covid-19 Second Wave - 25th Sep 20
Precious Metals Trading Range Doing It’s Job to Confound Bulls and Bears Alike - 25th Sep 20
Gold and Silver Are Still Locked and Loaded… Don't be Out of Ammo - 25th Sep 20
Throwing the golden baby out with the covid bath water - Gold Wins - 25th Sep 20
A Look at the Perilous Psychology of Financial Market Bubbles - 25th Sep 20
Corona Strikes Back In Europe. Will It Boost Gold? - 25th Sep 20
How to Boost the Value of Your Home - 25th Sep 20
Key Time For Stock Markets: Bears Step Up or V-Shaped Bounce - 24th Sep 20
Five ways to recover the day after a good workout - 24th Sep 20
Global Stock Markets Break Hard To The Downside – Watch Support Levels - 23rd Sep 20
Beware of These Faulty “Inflation Protected” Investments - 23rd Sep 20
What’s Behind Dollar USDX Breakout? - 23rd Sep 20
Still More Room To Stock Market Downside In The Coming Weeks - 23rd Sep 20
Platinum And Palladium Set To Surge As Gold Breaks Higher - 23rd Sep 20
Key Gold Ratios to Other Markets - 23rd Sep 20
Watch Before Upgrading / Buying RTX 3000, RDNA2 - CPU vs GPU Bottlenecks - 23rd Sep 20
Online Elliott Wave Markets Trading Course Worth $129 for FREE! - 22nd Sep 20
Gold Price Overboughtness Risk - 22nd Sep 20
Central Banking Cartel Promises ZIRP Until at Least 2023 - 22nd Sep 20
Stock Market Correction Approaching Initial Objective - 22nd Sep 20
Silver Bulls Will Be Handsomely Rewarded - 21st Sep 20
Fed Will Not Hike Rates For Years. Gold Should Like It - 21st Sep 20
US Financial Market Forecasts and Elliott Wave Analysis Resources - 21st Sep 20
How to Avoid Currency Exchange Risk during COVID - 21st Sep 20
Crude Oil – A Slight Move Higher Has Not Reversed The Bearish Trend - 20th Sep 20
Do This Instead Of Trying To Find The “Next Amazon” - 20th Sep 20
5 Significant Benefits of the MT4 Trading Platform for Forex Traders - 20th Sep 20
A Warning of Economic Collapse - 20th Sep 20
The Connection Between Stocks and the Economy is not What Most Investors Think - 19th Sep 20
A Virus So Deadly, The Government Has to Test You to See If You Have It - 19th Sep 20
Will Lagarde and Mnuchin Push Gold Higher? - 19th Sep 20
RTX 3080 Mania, Ebay Scalpers Crazy Prices £62,000 Trollers Insane Bids for a £649 GPU! - 19th Sep 20
A Greater Economic Depression For The 21st Century - 19th Sep 20
The United Floor in Stocks - 19th Sep 20
Mobile Gaming Market Trends And The Expected Future Developments - 19th Sep 20
The S&P 500 appears ready to correct, and that is a good thing - 18th Sep 20
It’s Go Time for Gold Price! Next Stop $2,250 - 18th Sep 20
Forget AMD RDNA2 and Buy Nvidia RTX 3080 FE GPU's NOW Before Price - 18th Sep 20
Best Back to School / University Black Face Masks Quick and Easy from Amazon - 18th Sep 20
3 Types of Loans to Buy an Existing Business - 18th Sep 20
How to tell Budgie Gender, Male or Female Sex for Young and Mature Parakeets - 18th Sep 20
Fasten Your Seatbelts Stock Market Make Or Break – Big Trends Ahead - 17th Sep 20
Peak Financialism And Post-Capitalist Economics - 17th Sep 20
Challenges of Working from Home - 17th Sep 20
Sheffield Heading for Coronavirus Lockdown as Covid Deaths Pass 432 - 17th Sep 20
What Does this Valuable Gold Miners Indicator Say Now? - 16th Sep 20
President Trump and Crimes Against Humanity - 16th Sep 20
Slow Economic Recovery from CoronaVirus Unlikely to Impede Strong Demand for Metals - 16th Sep 20
Why the Knives Are Out for Trump’s Fed Critic Judy Shelton - 16th Sep 20
Operation Moonshot: Get Ready for Millions of New COVAIDS Positives in the UK! - 16th Sep 20
Stock Market Approaching Correction Objective - 15th Sep 20
Look at This Big Reminder of Dot.com Stock Market Mania - 15th Sep 20
Three Key Principles for Successful Disruption Investors - 15th Sep 20
Billionaire Hedge Fund Manager Warns of 10% Inflation - 15th Sep 20
Gold Price Reaches $2,000 Amid Dollar Depreciation - 15th Sep 20
GLD, IAU Big Gold ETF Buying MIA - 14th Sep 20
Why Bill Gates Is Betting Millions on Synthetic Biology - 14th Sep 20
Stock Market SPY Expectations For The Rest Of September - 14th Sep 20
Gold Price Gann Angle Update - 14th Sep 20
Stock Market Recovery from the Sharp Correction Goes On - 14th Sep 20
Is this the End of Capitalism? - 13th Sep 20
The Silver Big Prize - 13th Sep 20
U.S. Shares Plunged. Is Gold Next? - 13th Sep 20
Why Are 7,500 Oil Barrels Floating on this London Lake? - 13th Sep 20
Sheffield 432 Covid-19 Deaths, Last City Centre Shop Before Next Lockdown - 13th Sep 20
Biden or Trump Will Keep The Money Spigots Open - 13th Sep 20
Gold And Silver Up, Down, Sideways, Up - 13th Sep 20

Market Oracle FREE Newsletter

How to Get Rich Investing in Stocks by Riding the Electron Wave

Will Silver’s Surprising Summer Surge Continue?

Commodities / Gold & Silver 2019 Aug 30, 2019 - 08:40 AM GMT

By: MoneyMetals

Commodities

Just a few weeks ago, silver naysayers told us we’d have to wait months, or even years, before the market made a big move. Now they are eating their words!

The white-hot metal surged past $18.50/oz this morning to reach its highest level in more than two years.

Silver is up more than 13% in the month of August alone, a time when many precious metals analysts had expected summer doldrums. Even some long-term silver bulls became short-term bears. 

The widespread pessimism toward silver is totally understandable given its performance characteristics over the past few years. 



Like clockwork, rallies would stall out at resistance levels. Banks and other commercial traders playing the short side of the futures markets would always overpower the longs.

So when open interest on silver contracts on the COMEX rose significantly last month, it seemed that big institutional short sellers were set up to smash prices back down once again.

That’s certainly what long-term silver bull Craig Hemke of TF Metals Report expected.  “JP Morgan and Citi [are] making sure there’s no breakout,” he said on the July 19th Money Metals podcast.  “You've got to figure that trend is probably going to continue.” 

Hemke didn’t think silver would get above the “tremendous amount of bank created and technical resistance” at the $17 level. “That's why I think gold continues higher and silver continues mostly sideways maybe for another six to eight months,” he concluded.

Oops!

In fairness, nobody gets short-term to intermediate-term forecasts right 100% of the time. Our friend Craig Hemke has gotten a heck of a lot of things right over the years – and he most certainly wasn’t urging long-term investors to bail out of their positions. 

I fully believe that what we're seeing in gold, silver, and the mining shares is the beginning of what may evolve into the greatest metals' bull market in which you and I have ever participated. 

In the early 2000's, I stated my belief that, before the public-mania phase had been completed a number of years hence, we would see silver prices over $150 an ounce. 

This may sound hard to believe. 

The reality is this: Trying to trade precious metals market day to day or week to week is almost always a mistake. The trends that really matter occur over periods of months to years.

If you missed the opportunity to buy silver while it was still on the ground floor because you worried prices might sink into the basement, there are a couple good reasons not to fret. 

First, silver under $20/oz. is still an amazing bargain. It could double in price and still sit well below its all-time high of over $49/oz. Silver remains cheap versus stocks, bonds, and even gold. 

Second, the silver market may finally be due for a pause, if not a pullback. The weekly RSI momentum gauge is in extremely overextended territory, above 70, for the first time since 2016.

ilver Chart - 2016-2019

That doesn’t necessarily imply a heavy and prolonged pullback will follow like the one that occurred from 2016-2018. Having recently broken out from that consolidation phase and now exhibiting bull market characteristics, silver’s pullbacks are more likely to be sharp and short-lived.

The next upleg in silver will probably coincide with a major trend change in the gold:silver ratio. That ratio hit a quarter-century high above 92:1 earlier this year but has retreated dramatically in favor of silver in recent weeks, today under 83:1.

old/Silver Ration Chart 83:1

The ratio seems to trend around its 200-day moving average (the blue line in the chart), which has been pointing up in favor of gold since April 2017.

With the ratio today now having fallen well below the trend line, a confirmed reversal of the major trend in the gold:silver ratio could portend big things ahead for silver prices.

Silver, being the more volatile of the two precious metals, usually outperforms during bull markets. 

The naysayers harped on the fact that gold was outperforming through the first half of the year while some of the more virulent anti-silver bugs reiterated their misbegotten belief that silver isn’t money and won’t provide investors any safe-haven from trade wars or recession fears.

It’s true that silver’s biggest demand component is industrial. But in recent weeks the poor man’s gold has completely untethered from copper and other industrial metals that have continued to sink. 

Unlike ordinary base metals, silver can move dramatically based on the wild card of physical demand from investors.

Not surprisingly, silver coin sales sank during the 2016-2018 basing out period that left some silver bugs feeling worn out and cynical about the prospects of prices breaking through ceilings in rigged futures markets. 

As the legendary Sir John Templeton once said, “Bull markets are born on pessimism, grow on skepticism, mature on optimism, and die on euphoria.”

Fortunately for silver bulls, we’re a long way from euphoria.

Stefan Gleason is President of Money Metals Exchange, the national precious metals company named 2015 "Dealer of the Year" in the United States by an independent global ratings group. A graduate of the University of Florida, Gleason is a seasoned business leader, investor, political strategist, and grassroots activist. Gleason has frequently appeared on national television networks such as CNN, FoxNews, and CNBC, and his writings have appeared in hundreds of publications such as the Wall Street Journal, Detroit News, Washington Times, and National Review.

© 2019 Stefan Gleason - All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules